CIS pig iron offers rise despite pause in sales
Posted on 17 September 2020
CIS merchant pig iron exporters have ramped up offers this week in negotiations with US buyers on the back of ongoing buoyant demand and rising prices in China. A lot of CIS-origin pig iron was sold by a trader at $395/tonne cfr China this week, market participants tell Kallanish.
Supply concerns are pushing prices up too, after a mining accident halted iron ore concentrate output at Russia’s NLMK, casting doubt on its output. The supplier is not in the market at the moment, traders say.
US buyers' demand is pegged at $370-375/t cfr Nola, while offers are at $390-395/t cfr. Two CIS suppliers are currently negotiating with US buyers, with sales estimated to close at $380-385/t cfr by several market participants. A major Russian supplier is offering to China at $400-410/t cfr, they add. One Ukrainian supplier says it is not looking at Asia for sales, amid ample demand in closer, traditional markets, as well as relatively low availability.
Italian negotiations are set to resume towards the end of this or beginning of next week, sources say. Pig iron prices are rising a little too fast for buyers in the country, but there is an almost urgent need to buy, and sales are expected next week. Turkey is also likely to come back to the market next week, sources say.
As Brazilian pig iron is sold out and there is no other source of merchant material, general expectations are that current offers will be accepted with very small discounts, if any. US appetite is returning in earnest, and with China always looking for material, there is no alternative. Rising scrap prices are adding fuel to the fire, source note.
Overall, CIS pig iron is offered at $365-375/t fob, depending on the region, around $5-10/t up on last week with expectations for further growth, fuelled by China and the US. This is despite no sales taking place in the past week.Source : Kallanish